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TIFs
Background * TIF = Tax Incremental Finance * TIFs are tax break deals. * With a tax break, a certain developer, generally a large corporation, gets to play less money than it should. When the developer pays less, everyone else pays more. Everyone else is generally the homeowners and the little guys. * TIFs and tax breaks go to those who are politically well connected. Comcast, PNC, and other developers have made TIF deals. * TIFs are confusing deals that are generally not well understood by the public. The confusion and complexity helps to sell the deal and get it passed public scrutiny. * TIFs are like bribes (that is bad) that come along with development (that is good). Since the sexy new buildings are desired, the bad gets to be coupled with the good. The dealmakers pitch this new development in the hype and they say that the TIF is a regular custom and cost of doing business. We need to think again so that all development comes based upon its own merit and ability to sustain itself, not with an incentive. The new development can be a way to undermine the existing base and only lead to churns in the marketplace. This can make the rich richer and poor poorer. * Pittsburgh has reached its limit on TIFs and is near to the state-wide cap. Pittsburgh and the URA have been master-minds in making TIF deals. * TIFs are often sold as public infrastructure investments. Don't be fooled. TIFs are often the handiwork of public authorities such as the URA, Parking Authority and the Water and Sewer Authority. Water lines, sewer lines, sidewalks, traffic and street adjustments, and even T-stops have been folded into these tax breaks so as to make them easier to pass. * TIFs rob present-day incomes in terms of governmental revenue. So TIFs mean that the kids in schools now have less resources. The various governmental departments have less in terms of meeting the challenges of today. Our needs at present are so pressing that we can't afford to do any additional TIFs. Doing various TIFs deals in the time of a booming economy might have different impacts and different ramifications. * TIFs can be called Corporate welfare. * Planks about TIFs from Mark Rauterkus * TIFs-plank-Peduto * TIFs-plank-Ravenstahl * TIFs-plank-AI about the hotel tax and TIFs Background Tribune Review, Feb 2006 Lance: To PNC Financial Services. The banking giant that will use $48 million in public subsidies to build a new Downtown skyscraper has, says one analyst, hit a major financial "home run" with the pending deal that combines its BlackRock Inc. money-management unit with Merrill Lynch. Translation: PNC could see its profits rise by 39 percent. All the more reason for PNC to build its new skyscraper with 100 percent of its own money. Laurel: To Bill Peduto. The Pittsburgh councilman is speaking out against an $18 million tax-increment financing package for the very wealthy PNC to build its very tony, 25 story-plus Three PNC Plaza. He says the tax break, known as a TIF, could be better used on projects that truly need the help. And he's exactly right. We trust Mr. Peduto will continue to press the point. Should he not, we will remind him. Links * Abatements category: finance category: democracy